NDIC warns Nigerians on wonder banks, MMM
By Abdul Olalekan
The Nigeria Deposit Insurance Corporation (NDIC) has warned Nigerians to desist from dealing with wonder banks as well as online schemes such as, Mavrodi Mundial Movement (MMM), stating that anybody transacting business with these institutions is doing so at his own risk.
The Managing Director/CEO, NDIC, Mr. Umaru Ibrahim, while speaking at a workshop organised by the corporation for Business Editors and Finance Correspondents in Kaduna State yesterday, noted that the corporation has identified two wonder banks currently in operation, and giving unrealistic promises to the unsuspecting public, stating that, wonder banks are not regulated by neither the Central Bank of Nigeria (CBN) or NDIC.
“As a regulator, we will continue to sensitise the public on the need to avoid patronising wonder banks as they were never regulated by NDIC or CBN. They are illegal and are out to dupe the unsuspecting public. We have information about two wonder banks currently in operation. We have called on the people to stop dealing with them,” he pointed out.
Moreover, he disclosed that the corporation was unhappy with the way at which Nigerians are patronising Mavrodi Mundial Movement (MMM), noting that this is an outfit operating in the cloud.
Warning the public not to be beclouded by greed because of attractive promises being given to its clients, he added that MMM launched a website targeted at the Nigerian audience in November, 2015, noting that the scheme promises a 30 per cent per month returns.
Noting that about three million Nigerians are already on the scheme as at October, 2016 with the unemployed and the general public as primary targets, he said the huge promises are not sustaining and may close down in the nearest future, just as it has done in some countries.
He equally warned people to dissuade from transacting business with other similar online schemes flooding the country, noting that this, among other schemes, are capitalizing on the situation in the country to cajole Nigerians to their sides.
To him, “the virtual and the anonymous operating style of MMM make tracking the accounts involved very challenging. MMM has no office, no fixed address and do not operate an account. MMM creates dummy accounts that are difficult to track, therefore, the way of curtailing its spreads to rely on the traditional methods of Russia, China, India and South Africa.”
Speaking on the impacts of the current recession on Deposit Insurance Scheme (DIS), the Director, Research, Policy and International Relations Department, NDIC, Mr. Muhammed .Y. Umar, said the possibility of bank failure as a result of recession could result in a threat to the NDIC’s insurance fund in terms of payout, adding that, banks could suffer from distress as a result of recession may require financial and technical assistance. This, according to him, could also result in a call on the NDIC’s insurance funds.
Proffering solutions, he urged the corporation and other regulatory agencies to be more vigilant in terms of regulation and supervision in order to address any problems that could arise as a result of the consequences of recession on the insured institutions.
Government, according to him, needs to remain focused on its efforts at diversifying the economy and other policies put in place to ensure quick recovery from the current recession. “When that is done, the economic environment will be conducive for the banks to operate safely which reduces the risk of failure and hence negative consequences on the NDIC,” he suggested.
